BMBE registration: who qualifies, what it exempts, where to apply
This page is for the owner of a small business, such as a sari-sari store, a carinderia or a home bakery, who has heard that a BMBE (Barangay Micro Business Enterprise) pays no income tax. At the end you will know whether your business fits the law's definition, what the Certificate of Authority does and does not exempt, and where to apply.
PhilForms explains the law and the form. The DTI's Negosyo Center decides your application. For a judgement call about your taxes, ask your Revenue District Office (RDO) or a CPA.
Who qualifies
The law that created the BMBE is RA 9178, the Barangay Micro Business Enterprises Act of 2002. Its definition has three parts (section 3(a)):
Test · What the law says; Activity · Production, processing or manufacturing of products, including agro-processing, trading and services; Size · Total assets, including those from loans, of not more than ₱3,000,000; Not counted · The land on which the office, plant and equipment stand
Any person, natural or juridical, cooperative or association that meets that definition may apply (section 5). The DTI's application form adds one limit to "services": it excludes services by anyone licensed by the government after passing a licensure examination, in connection with their profession (BMBE Form 01). So a licensed nurse or engineer cannot register their professional practice as a BMBE.
Note that the test is assets, not sales. A store selling ₱40,000 a month can qualify if what it owns and uses for the business (stock, shelves, the freezer, a motorcycle for deliveries) is ₱3 million or less, not counting the land.
What the Certificate of Authority exempts
From RA 9178:
- Income tax. "All BMBEs shall be exempt from tax for income arising from the operations of the enterprise" (section 7). - Local taxes: only if your LGU chooses. The law says LGUs "are encouraged" to reduce or exempt BMBEs from local taxes, fees and charges (section 7). It does not require it. Ask your city or municipal treasurer whether your LGU has an ordinance. - Minimum wage. BMBEs are exempt from the Minimum Wage Law, but employees keep the same social security and health care benefits as any regular employee (section 8). - Credit. Land Bank, DBP and other government lenders were told to open a special credit window for registered BMBEs (section 9).
What it does not exempt
Section 7 names only the tax on income from the business. The Act says nothing about percentage tax, VAT, or the returns you file, so the certificate is not, by its words, an exemption from those. Ask your RDO what you still file while you hold a certificate.
A BMBE also cannot use the 8% income tax option at the same time as its BMBE status (8% vs graduated rates).
Where to apply, the fee and how long it lasts
The 2002 law had the city or municipal treasurer register BMBEs. The Go Negosyo Act changed that: the DTI, through the Negosyo Center in the city or municipality, "shall have the sole power to issue the Certificate of Authority for BMBEs" (RA 10644, section 5(b)), and the old treasurer section was repealed (section 15).
Item · Rule; Where · The Negosyo Center of your city or municipality (RA 10644, section 5(b)); Fee · Not more than ₱1,000, remitted to the National Government (same section); Validity · Renewable every two years (same section); Form · BMBE Form 01, Application for Registration as BMBE (DTI download)
What the form asks
BMBE Form 01 is one page (DTI download). It asks:
1. New or Renewal, and your certificate number if renewing. 2. The business name as registered with the DTI, SEC or CDA, and that registration number. A sole proprietor usually registers the name first (DTI business name guide). 3. The owner's name and sex (sole proprietor), the business address, branches, phone and email. 4. Type of organization, new or existing business, and the principal activity (production, processing, manufacturing, trading or services). 5. Product lines, other businesses you own, total assets to the nearest thousand pesos excluding the land, and the number of employees by sex and by regular or part-time. 6. An undertaking, signed under the penalties of perjury, that the information and the asset size are true.
Mistakes that cause trouble
- Writing your monthly sales in the total assets box. The box asks for assets, not sales. - Counting the land. The form and the law exclude the land the business stands on. - Letting the certificate lapse. It is renewable every two years, and the form has a Renewal box. - Selling or transferring the business without telling the Negosyo Center. The undertaking says you will report any change in ownership and surrender the original certificate for notation (BMBE Form 01). - False information. A willful violation of the Act carries a fine of ₱25,000 to ₱50,000 and imprisonment of six months to two years (RA 9178, section 13).
Questions
Pwede ba ang sari-sari store sa BMBE?
The law covers trading, and a sari-sari store buys and resells goods. What decides it is the asset limit: not more than ₱3,000,000, not counting the land (RA 9178, section 3(a)). The Negosyo Center decides the application.
Saan ako kukuha ng BMBE certificate, sa munisipyo ba?
At the DTI's Negosyo Center in your city or municipality. Since the Go Negosyo Act, the DTI through the Negosyo Center has the sole power to issue it (RA 10644, section 5(b)). Many Negosyo Centers sit inside the city or municipal hall, so ask there.
Hindi na ba ako magbabayad ng percentage tax kung BMBE ako?
The Act exempts tax on income from the business (RA 9178, section 7) and does not mention percentage tax. Ask your RDO what you still file. The 2551Q guide explains the quarterly percentage tax return.
How much is the BMBE fee?
Not more than ₱1,000 under the law (RA 10644, section 5(b)). The Negosyo Center tells you the amount it charges.
Gaano katagal valid ang BMBE?
Two years; then you renew (RA 10644, section 5(b)).
Last checked 2026-10-23. Not affiliated with BIR, SSS, PhilHealth, Pag-IBIG or any government agency.
Fill DTI Application for Registration as Barangay Micro Business Enterprise (BMBE Form 01) now